> If code is law
Code is not law.
Code is not law.
If you're not into the cryptocurrency mess, this reads like regular old hacking. "If code is law and your code allows me to execute arbitrary SQL queries, then this SQL injection is perfectly legal" doesn't hold up in court. The FBI will not let you go because technically you only asked the remote server to execute your request.
It does invalidate the "code is law" concept, but in the real world, code isn't law.
"Manipulating" doesn't seem like the right word here.
This is more like a billionaire buying up a popular social media platform and then once he owns the majority of it, deciding how it should operate.
Looking at the Terms and Conditions as well as the contract, this goes under "A fool and her money". There was no embezzlement at all, this contract literally said people with more money can potentially vote to take all the money. Which is madness, but people agreed to it.
Which is illegal, and will get you sued if you try it.
Code is not law, but this “attack” isn’t abusing the code so much as the basic premise of what the code is designed to do. This is the intended agreement
Here's the challenge, though: it is impossible to definitively say whether the functionality of a program is intended behavior or not. For a classical server that gets "hacked", the code is running on a server that someone owns and access to that server is defined by the owner. Similarly, the maintainer of the code decides whether the behavior of the code was intentional or not.
On a blockchain, there is no single server, the code is being executed on many machines. And you can't trust any individual, the author of the contract got their chance to clearly describe the intention of the code when they wrote it. There is literally no way to determine whether the contract was used as intended, or exploited. You can't go ask the author because they can just lie. The code is all you have.
But that doesn't mean "code is law". Consensus is law. The blockchain can be forked, the transaction reversed, and the contract amended.
> in the real world, code isn't law.
That hardly matters here.
No; the law is the law. What exactly do you intend the content of the statement 'consensus is law' to be? The world 'law' has a meaning, and it's distinct from the meaning of 'consensus'.
The whole idea that you'll replace the existing legal structures with some consensus of transaction miners is some apocalyptic nerdvana with no basis in the real world.
Cryptocurrencies claim to be something else. Something that isn't government by terms of service, laws, etc. How else could you create a worldwide decentralized currency without adopting a rule that code is law.
My main objection is calling it law: if you’re scammed while purchasing illicit substances on a darknet marketplace, you have no legal recourse, but the marketplace’s rules can’t be called “law”, either.
No, it's not.
At best, there is some kind of implied-in-fact legal contract related to to the code in the “smart contract”.
“Code is law” is an aspirational slogan repeated by people who fetishize the former and oppose the latter, usually without understanding it (or either.)
You can have a contract that both parties thinks says one thing, but they each have something different in mind. That's a failure of mutual assent. You can have contracts where the thing which is contracted on becomes impossible. One party can misrepresent the contract, either deliberately or innocently. The contract can be agreed to under duress; or be so uneven in its obligations that is manifestly unconscionable.
To a greater or lesser extent, all these scenarios can give rise to rescission of contracts or their avoidance in courts of law. The idea that code is an unambiguous statement of the contract and therefore definitively legal and perfectly binding is nonsense.
The question isn't, "once we get these people in a room, how do we (as a legislative body) decide who owns what and compel the parties into cooperating?" The question is, "these parties are assumed to retain perfect anonymity, and they operated according to the design of the consensus-based system that we (as miners) agree to; are we ok with the outcome? Should we come to a consensus on an adjustment to the design?"
Smart contracts are unambiguous by definition. What you're describing is PEBKAC at best.
It doesn't matter whether the contract is unambiguously written if you sign it with a gun in your mouth.
There's no way to do this in code. You need a judicial system to make determinations on them based on facts. There is no "adjustment to the design" other than incorporating some kind of arbitrary undoing capability into smart contracts that defers to a legal oracle that consumes decisions of courts and applies them into the chain.
From the little I know of this case it seems likely that this should have been governed under securities law and all participants should have been kyc'd. If that didn't happen then it looks like someone was committing securities fraud.